Green Finance and Inequality

Ola Mahmoud and Tschan Lea
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Ola Mahmoud: University of St. Gallen; University of California at Berkeley; Swiss Finance Institute
Tschan Lea: University of St. Gallen

No 23-54, Swiss Finance Institute Research Paper Series from Swiss Finance Institute

Abstract: This paper provides empirical evidence for a significant positive association between green finance and top income inequality from a panel of 87 countries from 2004 to 2020. This relationship is strongest for countries with initially lower levels of income, low levels of financial development, and low levels of carbon emissions. We also find evidence that the effect on inequality persists for four years and thereafter abates. We argue that the association between green finance and inequality is at least partially driven by two mechanisms: technological change and investment emissions. Using a moderated mediation design, we show that technological change and investment emissions are partially mediating the relationship between green finance and top income inequality.

Keywords: green finance; inequality; innovation (search for similar items in EconPapers)
JEL-codes: D63 E44 O33 Q52 Q54 Q55 (search for similar items in EconPapers)
Pages: 68 pages
Date: 2023-06
New Economics Papers: this item is included in nep-ene, nep-env, nep-fdg and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:chf:rpseri:rp2354

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